Globalization and Labour Market Reform: Patterns of Response in Northeast Asia

Abstract

The ‘varieties of capitalism’ literature identifies the labour market and labour relations system as an institutional feature by which liberal market economies (LMEs) and co-ordinated market economies (CMEs) of advanced countries may be distinguished. This literature argues for the resilience of CME institutional features to the allegedly convergence-inducing or homogenizing effects of globalization. Resilience to convergence has also revealed different patterns of institutional adaptation to globalizing pressures among CMEs. This article examines the adaptation of labour institutions to globalization using the Northeast Asian Newly Industrialized Countries of South Korea (hereafter Korea) and Taiwan as case studies. Examples are given of how Korea and Taiwan have pursued labour market liberalization, but within institutional conditions (policies and politics) distinct from those associated with transitions to the LME. The origins of this distinctive pattern of response are explained, pointing out the need for explanations based on globalization to be supplemented by ones that emphasize economic legacies and political logics.

The Emergence of a New 'Socialist' Market Labour Regime in China

“…In general, these writings assume that an achieved state of institutions shapes this development. In his comparative examination of the adaptation of labour institutions, Kong (2006) draws on the distinction between liberal market economies (LME) and co-ordinated market economies (CME) and analyses the adaptation of South Korea and Taiwan to globalization. He identifies distinct patterns of labour market liberalization among the so-called CME based on supplementary explanations emphasizing economic legacies and political logics.…”

Between Fragmentation and Centralization: South Korean Industrial Relations in Transition

“…However, policies promoting the partial inclusion of labour do not necessarily mean that the Korean government fully supported the progressive goal of the democratic labour movement. As Kong (2006a: 379) stated, the authoritarian inclusion of labour meant ‘being selectively pro‐labour without being anti‐business.’ Actually, Roh's presidency was marked by a relatively large number of labour disputes because of the tougher measures aimed at facilitating labour market flexibility and structural adjustments. The priority of the government's labour policy switched back to enforcing laws to prevent illegal strikes, and the state gradually withdrew its lukewarm support for industrial unions.…”

Social dialogue and industrial relations in South Korea: Has the tripartite commission been successful?

“…The introduction of the KTC has come under pressure for both improved labour rights and labour competitiveness. To put it differently, the social dialogue has emerged in the context of making the ‘dual transition’ to democracy and economic liberalisation (Kong, 2006b: 364–365). This constitutes distinctive characteristics different from those associated with the re‐emergence of the social dialogue of the 1990s in European countries as a response to economic concerns alone.…”